Transcription
Preston great to see you hey how are you
guys doing very well who do we have huh
who do we have here Uncle Preston There
You
Go uncle Prest how are you doing how are
you doing I'm doing good thank you good
good are you like in this bull
market yeah I didn't I didn't even
realize we got to 100 and something K
until like well who was last who was
last to know there was 100K in our
house me
yeah that really yeah yeah the thing is
mommy come up and told you but I think
you guys were already awake and i'
already seen no I I didn't know but like
when she was like oh yeah I reached 100K
I was like Y is that it like we've been
for so long is this 100K in Euros that
you're talking about or dollars dollars
dollars dollar okay even even this
decided upon Preston everybody's
tracking that that dollar price although
I did put out a tweet the other day you
know where death is going along banging
on the doors so I had dollars 100K Slade
Euro 100K Slade and knocking on the the
Sterling door but vulka BTC vulka hat
tip he corrected me he's like dude don't
forget the Swiss I'm like oh he's
right the Swiss frank the Swiss frank is
so the only two standing are the Swiss
frank and the the Great British pound
they're the last two doors yeah so it's
coming it's coming quickly it's coming
it's happening and the crazy thing is if
you're Swiss and British listening to
this right now if do you think we're
going to 100K in those in those
currencies if so buy Bitcoin like you
know what are you doing I thought we
just hit 100K in not in not in Swiss
frank or pounds oh Euros we have oh okay
yeah so yeah two more two more to full
uh what did you want to ask Preston um
what was your favorite Bitcoin
conference this year and why oh my this
year I would have to go with
madira uh that one was just awesome the
location was Unreal it was a place I
would never have gone uh for people that
don't know where madir is it's off the
coast it's actually kind of off the more
off the coast of Africa but it's a
Portugal uh what would you say Daniel is
this like a province or how would like
yeah probably proper technology yeah but
yeah just gorgeous the thing I like
there is it wasn't like outrageously
priced either like if you went out to
dinner or were like staying at a hotel
it like wasn't bad and so uh that
combined with just the conference was
awesome it was really well put together
uh big fan of Andre who does it
unfortunately they're only doing this
conference every four years on the
having years I guess is is what I've
heard but probably my favorite yeah how
about you
guys M well yeah madira and Prague is
close up prag is always a nice one but
Madera was probably the best for kids
because that's when there was actually a
lot more kids our age
MH and it kind of funny because every
five minutes I kept bumping into people
that I knew so I was like oh hey I got
on a conversation and my friends were
trying to drag me away they're like this
is like you've been here for an hour can
we please leave was like yes it was
something special I still haven't gotten
over the uh the loss of uh when I was
playing your sister at chess I still
haven't recovered from this yeah I I
didn't know which one won but I was like
trying to remember I was like oh yeah
didn't they play chess together giant
chess on the LA I don't think we even
finished I think we were yeah I don't
yeah I'm not sure but yeah it was fun so
yeah for me madira as well there was
something so special going on it was
pumping at the time it was an new time
high at the time yeah yeah there were
tears there were tears and he really I
couldn't I I lost it when Andre lost it
given the closing talk I was because I
was sitting next to my wife who was
sitting next to Andre's wife and then
Andre lost it on stage I'm I'm I'm
croaking up just now thinking about it
uh but there's something so and a
genuine thank you to yourself for for
coming across because and you know I
don't want to blow smoke up your ass
here Uncle Preston but
I I think a lot of Americans don't grasp
the kind of the gravity of like the
difference you've made in people's lives
over here on this side of the pond
that's you that's Lynn that's Jeff
that's Michael a lot of people gave up
their time to come over here and it was
um yeah awesome great to see man oh
really appreciate I love traveling to
Europe there's it's it's so much
different than the US and you know I'm
food's better I kind of enjoy being able
to go out I really like the Bedford
conference too this past year like that
was really fun going out and just like
hitting the pubs and I don't know I like
going to Europe all right well we'll see
you back here next year we hope yeah oh
yeah I'm sure you have anything
planned uh I haven't officially
committed to Bedford but I would kind of
like to do that one again uh and uh I
would like to go to the Prague
conference my son's on a robotics team
and um last year uh I was it that or is
Boy Scout camp or something it was like
one of the two that I couldn't go last
year because of one of those two things
and um yeah I'm hoping that I have
availability this year because I really
want to go to that conference a lot yeah
that's going to be June mid June I've
got the dates somewhere but yeah do we
have any conferences we're going to go
to Prague for sure and we'll go to
Helsinki that's in Finland in a
it's going to be the first time to go to
to Finland for us how fun is this how
fun is this it's it's the best you tell
me this no uh I was talking to so Luke
is you know the other half of Cano's
Bitcoin podcast show big one Infinity
show Luke and Cano do it together but
Luke's one of the organizing uh members
and yeah we're gonna go nice speaking
yeah I'll help uh host and MC and things
like that whatever they need what what
whatever help they need I'm you know
there for them go that's uh really need
to go to Sweden next we've not been to
Sweden either yeah this year we went to
Oslo the human rights Foundation that
was good fun as well Bulgaria was the
first time for us I've heard Oslo is
really impactful yeah I heard it's
really nice yeah yeah and what we were
saying was really pretty too you just
and it it was really pretty because we
were like in a forest and then like a
lake over there and you just kept seeing
like the past it was really nice and
that's when we went to the farm and I
touched the C for the very first time
yeah we did Bitcoin bondon I don't know
if you follow him on Twitter the the
Norwegian the Norwegian farmer that
bought cows about two years ago and he's
doing a whole regenerative farming thing
up there bcoin for beef yeah he's he's a
great guy wow that sounds awesome that's
the thing I love about the space it's
just people are approaching it from all
different kind of lenses and angles and
and it's just kind of amazing how it
fits into like everybody's kind of niche
in somehow some way some capacity it's
just
amazing do you have any further
questions Lauren no I do not but um no
all right yeah thank you for having me
and hopefully see you soon yeah I hope
to see you soon as well yeah okay bye
bye have a good day bye see
you right Preston so what I wanted to do
was kind of a a
macro year and revie you and could think
of anybody better than yourself yeah to
just go through a couple of the talking
points of what's happened in 2024 and
obviously the biggest story at the
moment is micro strategy and yeah it
kind of well he's pulling people in it
seems to be every other week now there's
a new announcement of a different
Corporation doing the same thing that
sailor's done um so I mean I was going
to make a list and go through it but
that can be a bit too
structured and uh not come across as
very natural so well this is where I
would start so the price at the
beginning of the year was
42,000 um based on that and where we're
at today we're at 108,000 right now it's
up 155% on the year for for Bitcoin
which is you know a pretty good year uh
and people that have maybe just arrived
this year and maybe have a 75% gain or
or whatever when they first bought you
got to realize like
155% pretty standard for for Bitcoin
that's kind of a pretty standard year to
be able to bang out 100 100 plus um so
yeah uh let me see what we had the year
before just to kind of put that in
perspective uh okay uh 2023 closed wo
that was brutal and it went to just the
number 16,000 at the end of the previous
year and it was up
150% previous year so that's two years
in a row we're at about
150%
um it uh from a macro standpoint Daniel
I mean we can talk about fixed income
you brought up the micro strategy and
how we have others now uh kind of
implementing that uh primarily publicly
traded miners which I think is super
fascinating and a topic that few have
covered the implications of um
so let's just let's go there yeah let's
go there why are Bitcoin
miners who actually you know earn
Bitcoin through mining now going into
the debt markets to raise Capital to buy
Bitcoin because they're mining the debt
markets nice analogy love it okay yeah
so if you can mine the debt markets and
be way more you know lucrative because
they're so
absurdly and how I don't know how long
I've been beating this drum for me it
feels like I've been beating this drum
for almost a decade now of like how
broke fixed income is Right fact I think
you could pull up any interview I've
ever done and you'll hear me talking
about how broke fixed income is okay so
let's do this Justice let's do this
Justice beat the drum One Last Time
fixed income how it's broken why it's
broken so so go back to
1981 here in the US and you had the
10-year treasury at like 16%
uh and you know you go into the longer
duration the yields were higher but
let's just use the 10-year treasury
because everybody you know uses that as
the risk-free rate and return uh for
anything with mediumsized duration so
you're at 16% and for 40 years that that
just continued to get compressed which
means the prices on bonds went up for 40
years straight and if you're in a I mean
there's volatility there but the
volatility stayed within a certain range
and for 40 years the the yields just
kept getting compressed compressed
compressed in covid they got down to 50
basis points which is 0.5% so you go
from 16% to 0.5% on the yield and what
if you're looking at the price of a
10-year treasury the price is going up
and to the right and just like hockey
sticking itself straight up so you're
paying more for Less basically
absolutely and so if that's your
benchmark for value and it's been priced
at a half a % and equities are priced as
a premium above that because there's
more risk
inip more risk okay a lot of people
figuring out that today that's not the
that's not the reality and I can get
into why that is but um so for 40 years
straight you have equities being bid to
the Moon you have fixed income being bid
to the moon but primarily fixed income
so how did they do how did this happen
how did how how what was the mechanism
behind this that caused these yields
that keep getting compressed well when
you print a bunch of money and you shove
it into the hands of the banks and uh
the select few they get first bite at
the Apple of what they want to do with
it what you find is a lot of people that
are super high net worth they just want
to be able to preserve it they don't
need to go out and hit a home run or hit
a grand slam or crank it out of the
ballpark they're already rich they can
already do anything that they want they
just need to make sure that they don't
lose that capacity and so the way a lot
of them continued to preserve that
buying power was they just lock it into
fixed income especially if interest
rates keep going down and if you're
locking it in the fixed income you're
bidding the price which is causing the
yields to keep going down and this was
the trade this was the 40-year trade
where everybody's stuffed their buying
power to preserve it and freeze it in
time so that they could have it for you
know a rainy day
someday when the bank so 2008 2009
happened okay and what's the response of
the of the us and every other major G7
economy well it was we need to get
liquidity into the system so what we're
going to do is we're going to step into
the fixed income Market we're going to
buy these bonds we're going to bid the
prices even higher compress the yields
even lower and provide liquidity into
the market and then it'll trickle on
down to everybody else right but what
happened is is the people that were
getting first bite at the Apple of all
this liquidity are saying no I think I'm
going to go buy Parkplace or I'm going
to go buy these other you know really
super high value and Michael uh sailor
talks about this all the time of like
people going and buying Premier Property
in Miami or New York or wherever this is
what they're doing with these things
okay it's not trickling down it's just
getting the the buying power is getting
rammed and stuffed straight into like
super desirable valuable things whether
that's artwork or
whatever so they keep doing this QE
thing which is just compressing the
yields lower and lower and the bond
price is going higher and higher so what
you have today going back to the
original point point you have people
that have finally figured out what I
feel like I've been screaming about for
a decade which is the fixed income
Market is manipulated it's all this
Printing and all this Central Banking
activity that was keeping everything
liquid and everything else bid prices
for 40 years straight it was a
Relentless bull market and as everybody
knows when you have a bull market that's
Relentless and goes on for eons
eventually there comes a time and a
reason for why that's going to start to
unrine on wind itself and what you're
seeing is and I literally just saw this
stat uh posted like right before we did
this interview listen to this stat this
is this is
hilarious um where is it at here uh okay
Bitcoin exposed convertible bonds which
comprise of 6% of the total convertible
uh universe and have produced
20% of the year-to-date
returns right so what are these what are
these companies doing well they're going
out and they're saying well uh fixed
income is
mispriced I'm going to insert Bitcoin
via convertibility into the common stock
for the people that are buying this
that's that's how they get Bitcoin
access is the convertibility of the of
the debt into equity which the equity is
buying Bitcoin on the balance sheet you
just want to explain like the the term
their convertibility what what option
does the holder have so this is real
simple so like let's say I'm going to do
a fiveyear note for a billion dollars um
I issue that into the into the market
and let's say I'm doing it at 1% so over
those five years every year I got to pay
out a percent and a percent of a billion
is uh what is that 10 million uh right
yeah 10 million okay so uh every year
I'd pay $10 million to the holder of
that for five years and then at the end
of the five years I've got to pay the
billion dollars back that's a
traditional Bond a convertible bond is
at the end of the 5 years I you have the
option to convert your your bond into
Equity as opposed to get your billion
dollars back okay so if the if the
equity the the amount of shares and the
strike price that you can do it at is
more valuable than a billion a lot of
fixed income holders will say yeah I
just want to convert it into Equity I
don't want the billion dollars you can
keep that uh I just want the common
stock which is more valuable than the
billion dollars that that was originally
issued and that's all it is and so what
you're finding is is you have Micro
strategy you have uh I think Mara went
out on the market they tried to raise
like ah these are ballparks 750 milon
800 million in a convertible debt deal
that had a
0% interest rate so instead z% yeah so
instead of paying the $10 million every
year to the to the to the holder of the
note they're literally paying them zip
zero um which tells you how desirable it
is because they're getting access to
bitcoin okay so and then it was
oversubscribed just like Michael's last
one that he did was oversubscribed by a
billion dollars so my comment as soon as
that came out was well it seems like his
strike on the convertibility was was too
low right because it was already a
0% so if it's z% I'm paying no interest
which is why he can keep doing this if
he's no never paying any interest like
he's making a bet that they're going to
convert into common stock and he doesn't
have to pay back the billion and if for
whatever reason the common stock would
be below because Bitcoin you know blew
up or whatever well then he has to come
up with the billion and pay it back
right but the fact that this is 5 years
in duration let's talk about a four-year
Bitcoin cycle and and this is obviously
past performance which isn't tell you
that that's what's going to happen in
the future but past performances you've
never had a compound annual growth rate
of anything under 2526 % annualized over
any 4-year period so if you're issuing
this into the market and it's five years
of duration do you think he's going to
have to come up with the billion dollars
to pay back on a billion dollar fixed
income convertible note probably not
they're going to all convert the where
they wouldn't convert is if the the
convertibility strike was too high right
so like part of the deal is like let's
say that the the stock is 100 bucks okay
and he says you can convert at
$120 or I I can pay you back the billion
dollars if it's if he puts that 120
strike way too high let's say you put it
at $500 or something like that the stock
was at
$400 that that would be and this this
math is really I'm just like throwing
numbers out here to try to make it easy
for people to understand let's say that
was like $800 million if they would have
converted it at that strike
they're not going to do that they're
going to they're going to take the
billion dollars instead of exercising
the convertibility so my comment when he
was over subscribed by a billion was
that he probably could have raised the
strike even
higher right so there's there's some
really interesting things with the math
and so like all of this is you're
basically going to this Market this
fixed income Market that is has never
seen anything like this
before that has that everybody's
starting to really kind of understand
the power of and they're mining this
because it's been so overpriced and so
overbid and yields have been compressed
down to nothing that these that they're
stepping into the market they saying
well I can just issue a bunch of this
and I can buy a bunch of that at no
interest and I can create enormous
amounts of shareholder equity and if for
the convertible debt holders for
somebody with a fixed income mandate
these are the best performing Bonds on
the planet right micro strategies of the
last four years those are the best
performing fixed income instruments on
the planet so not only is he benefiting
but the people buying the debt are
benefiting tremendously because they're
participating in this and I think that's
what's lost on a whole lot of people
right now is they're like well who's he
screwing and it's like well winwin win
he's screwing everybody who's refusing
to participate in this
network that's who he's screwing so I
think one last important point that
people might have a question over here
is come that time of
convertibility does he do a stock split
does he just issue more shares what what
are the so now think about this so like
the reason he can go out and buy another
one like this this Monday went out and
bought another $1.5 billion so he takes
it he just issues more shares into the
market he raises a bunch of cash he
takes the cash he goes and buys Bitcoin
he sticks it on the balance sheet
so think about this so here's here's the
thing that like you'd see on Twitter
people would say oh he's diluting the
shareholders he is but as a shareholder
I'm happy with that because the compound
annual growth rate that I'm expecting
out of the Bitcoin exceeds that of what
he can do with his company making call
it 100 million a year okay so and this
is the important part the shares are
currently priced two to three times the
treasury value so let's just use really
simple numbers if the treasury value is
100 okay and his common stock is being
sold for 200 a share okay it's 100 per
share $100 worth of bitcoin and his
common stock is worth $200 a share he
can effectively issue another just one
share he raises
$200 and then he goes and
buys let's say the price of bitcoin's
you know uh 100 he can go buy two
Bitcoin for the the cash he just raised
so effectively if Bitcoins call it
100,000 he's buying it for
50,000 because his common stock is
trading at twice the value of the
underlying treasury value so why
wouldn't he do that all day
long right as as a shareholder like I'm
thrilled that he's doing this he should
be do he should be doing this as
aggressively as he possibly can as long
as there's a 2X or a 3X premium on his
common stock
so you
know the other thing that I'd say is is
because of the way that fast money Works
on Wall Street and he's he's going out
and doing these convertible debt deals
and uh and what what they have to do is
they have to position themselves through
the derivatives markets and and what you
do is you create this enormous
tremendous amount of of volume of trade
on the common stock because of the
convertible debt deals okay so if if
you're going to have to sell a whole
bunch of common stock to raise cash and
buy
Bitcoin the convertible debt deals are
actually advantageous to that because
they're they're providing really really
deep liquidity into the common stock
market for him to sell more of his
common stock and issuance to raise cash
and buy pick which is even crazier now
because NASDAQ 100 absolutely so now you
have the NASDAQ 100 so if the general
Equity markets are bidding this is just
more creative to his ability to sell
more common stock into the market
because it's bidding up he can sell more
into it and just converted into more
Bitcoin okay so you what you have is a
race and you have a couple very early
you know you go out and uh I was I I
volunteered with my son uh for a
marathon this uh past week we were there
handing out water and stuff and you know
what it's amazing to watch the
difference between the
elite the one that are pretty dang good
in the middle of the pack right the
elite there was like five of them right
and then there was nobody for minutes
for minutes and then all of a sudden you
started having like the better Runners
were showing up and then you just had
like the crowd and I mean it was just
like cattle right and there the other
night the other neat thing is those
Elite Runners they just blew right past
us like like they didn't even see us
like handing out Waters like I don't
need your freaking water like I'm going
to be done with this race in like
minutes from now right and uh I would
say that what we're seeing right now is
we're watching the elite
Runners uh they're just gobbling up as
much of this stuff as they possibly can
because they've totally figured out what
the hell is happening and uh they know
that this is the new global settlement
layer they know the fixed income Market
is totally afed in Fiat terms and uh
they're doing everything they can to put
as much of this on it as they can and uh
I think that the I think the the
professional runners are starting to
show up some of them uh and I think this
year is going to be
demonstrative freaking demonstrative as
to the the pros kind of showing up to
the table because I think they're going
to truly start figuring it all out and
uh hang on well 2025 2025 we get the the
gasoline ped on the fire yeah we have
the fast B new accounting rules well I
mean what is micro strategy's first
quarter going to look like like their
earnings so if we look I look at his
last um so sailor here micro strategy
has acquired
15,350 Bitcoin for $1.5 billion doar at
10,386 per
Bitcoin da so year to uh so as of
December 15th we hodle nice one mik
439,000 Bitcoin acquired for $ 27.1
billion at an average price of 61,7
which they've never been able to account
a profit for in any of their earning
statements well so you got to be real
careful on the accounting terminology
here okay when you say the word profit
profit is a realized thing that is an
income statement thing and this is an
unrealized gain okay so this is a
balance sheet item that will be listed I
haven't studied the the Gap accounting
as to like but this is how it should be
treated I'm pretty sure this is probably
how it will will be treaded um it's an
unrealized gain which means it's
something that you list in the equity
column of the balance sheet okay he
lists how many Bitcoin he bought it
right as as an asset he lists the basis
and then that goes over on on you know I
would treat this as a current asset
because you could sell it within 12
months and it's very liquid um maybe a
marketable marketable security current
asset uh on the balance sheet but you'd
list the principal that you paid and
then any Delta between what the current
spot price is and what he paid would be
listed as an unrealized gain on the
equity line of the balance sheet okay
none of that is flowing over to the
income statement at all so what you
would see what I would expect that you
would see on the micro strategy income
statement would be the 75 million or100
million of annualized profit somewhere
in that ballpark okay you won't see any
of this Bitcoin stuff hit the income
statement and so that's been the issue
all along is like the treatment has been
well if you have an unrealized loss you
have to list that on the income
statement as if it was a profit loss
thing when it's totally not you sell
nothing so that's that's the treatment
that's how it's changed and um I guess
inclusion in the S&P 500 is going to be
I mean think about this who's going to
want to own
spy versus QQQ if there's no companies
in there because of the tax treatment
and they' got wait a year I think this
is like if you're if you're running spy
or any other S&P 500 Index you should be
lobbying and fighting like hell to get
the uh micro strategy and any other
Bitcoin company because of the Gap
accounting treatment added uh because I
think you know passive investors and I'm
sure they're not following any of this
but pass like if I had to buy one of the
two you better darn well believe I'd be
in QQQ and not the S&P
500 and I'm not Nei it's it's going to
be an incredible year I'm proudly not
neither yeah it's G to be and again I
tweeted the other day I want to know who
is making the uh the msft tracker the
day they said no to putting Bitcoin on
the balance sheet so let's have the
comparison rolling because in four years
time that is just going to be absolutely
dude it wasn't just that it was it was
also that he was replacing madira uh um
madna the farm
into the QQQ oh was that right it was it
was that and the fact that he was
included into the NASDAQ on the same day
that M uh Microsoft decided to not put
it on the TR I mean it was just it was
really ironic and then you had Satoshi
Nakamoto that now is exceeding the net
worth of Bill Gates like all of these
things kind of happening L literally
like all in the same week to me is like
this is a freaking simulation to
Goosebumps
so that was the whole Microsoft thing
goodness me like the hubris of those
guys is just unbelievable like right
okay let's ask this CEO chairman owner
of this company of a competitor of 35
years let's have him teach us us about
teach us about Bitcoin let's invite him
but he's got three minutes to do it in
yeah I mean Mike could have just said
yeah gfy guys really I've got better
things to do in my time I loved this is
what I loved about what Mike did so he
had three minutes he just took literally
it's almost like you know how these AI
models just take like all the
information in the world and they
compress it and then in order to get an
answer out you have to decompress what's
what's in these small files and I'm
saying small they're and they are
relatively speaking for how much is
compressed in there Mike just took
everything he knew he just compressed it
into 3 minutes and like everything was
just like Sure Fire like arrows flaming
arrows straight to the heart and it was
like either you can decompress this with
about 100 hours worth of work to fully
understand how profound what is
compressed into these three
minutes or you or you or you don't have
to but it requires energy to decompress
it and he sure gave them the compressed
file and we'll see if anybody you know
pays attention I think there are a lot
of people paying attention who cares if
micro strategy or or Microsoft doesn't
figure it out yeah I don't abely
absolutely and the the beautiful thing
about that presentation was it was up on
Twitter within minutes so it wasn't just
in the wall Garden of the Microsoft
boardroom every pleb got a chance to see
that and literally be a fly on the wall
in the Microsoft boardroom it it's the
biggest Clinic Financial engineering
Clinic I've ever seen on on planet Earth
and it's so amazing that it's it'd be
like going on like uh know you go to
like the playground and Michael Jordan's
out there just dunking on everybody
right and and people are still watching
saying yeah I don't know if he's that
good or not like I can't really
tell that's what's happening right now
and it's just like how can't people see
what in the world is happening like this
dude is like flying through the air like
just dunking on everybody and the the
bystanders just like they're like is
this good I can't tell
he's cheating or whatever I don't know
all right so I think we've done micro
strategy don't want to talk too much
about Microsoft but we can't we we have
to talk about Trump the
election uh Daniel before we go there
the one thing I do want to say about the
minor thing so I don't I don't know how
this I don't know how this plays out
long term if you have publicly traded
miners that can pull so much
productivity into time now so like the
mara deal I was looking looking at this
and like this is at least 15 years worth
of mining through the mining of the
fixed income convertible note that they
did they've basically pulled their
production forward by like 15 years plus
right I did some math around it it was
like in excess of 15 years worth of
production that they pulled into today
right now because of how they did this
and so if you start a race which now I
saw Riot is doing the same thing I found
it interesting that they paid 75 bips
for their for their deal versus Mara
zero I thinks to the health of yeah
probably speaks to the health of the
company um but regardless if you're
pulling all this production forward you
have to start asking yourself if you're
not publicly traded and don't have
access to these public fixed income
convertible debt markets um are you are
you a dead man walking like four to8
years from
now and that gets really interesting
right because uh when you especially
when you start looking at the
institutional ownership of a lot of
these miners it starts going into Wall
Street hands if they're going to be the
dominant players and I think that
there's just I think there's a whole lot
for people to think about and I think
there's a whole lot for people to talk
about with respect to this and I haven't
even like I don't feel like I've
invested enough time myself to
critically think about all the
implications but a couple that I just
threw out are my concern areas and maybe
uh think the areas that I think people
need to spend a bunch of time thinking
about well let me I mean the first thing
I'm picking up on is you you're you
obviously have strong concerns about the
centralization of
mining well I don't know that I think
that the I've covered this on the show
The the centralization of the pools I
think is maybe even a bigger concern in
the block templates which ocean I think
is you know obviously doing a great job
kind of you know ringing that Bell um on
the mining front I'm I guess I'm just
more concerned as to institutions being
able to uh you know if you got a couple
really too big to fail Banks like really
kind of controlling the boards of these
companies or really kind of uh then I
think it could be concerning but um I
think we're really really really far off
from that but um it's it's something to
think about I think it's a you know
critical thinking exercise that needs to
probably be done by quite a few people
will we see just on this topic again
will we see do you think uh more of like
the private miners going public to get
in this
race if I if I was a public I'm sorry if
I was a private minor um I'd be
concerned about
this um just from a competition
standpoint because think of it if you
can pull 16 years worth of mining
forward to now the price really runs and
you're and you're retaining all this in
Bitcoin and let's say the price runs to
half a million or whatever you kind of
have a really massive advantage over
people who weren't able to do such a
thing so then do they do they action
that or do they continue to just double
down and mine the the fixed income
Market as opposed to I mean they they're
still mining Bitcoin obviously but what
they're really mining is the fixed
income market and how broke it is and so
like if you if you really get ahead on
that it is going to have implications
for what they're doing in the physical
space too with the rigs and you know the
the real mining of
Bitcoin you so with Mara for example is
all of that money all of that Capital
going to go purely to bitcoin purchase
or are they going to be looking to grow
the footprint of their just going out
and buying the Bitcoin wow I mean that's
what I would be doing I wouldn't be like
then selling that and buying I mean you
just buy the rigs from the start if
that's what you were trying to do there
is going to be such a huge demand for
rigs my goodness that's what I'm
thinking as well and if you're a private
minor and you can't get your hands on
the rigs you're out of the game quicker
than you could even
imagine yeah
uh I mean maybe maybe the thing that
causes this to slow down is because the
fees start to become so valuable on
chain I don't I dude I don't know but I
do know one thing I think this is a
trend that's going to pick up and I
think it's going to be extremely
advantageous for publicly traded miners
versus private
Miners and here's an interesting thing
like the skill set to be sat in the
position to be making these decisions
we're going to need a lot of fat-based
financial Market plebs to make the jump
from their Fiat world into the Bitcoin
world so that's exciting a lot of people
I'm Pro you know probably listening
thinking of how do I get out of my fat
day job it's you it used to be all
software developers and you know shadowy
super coders they they were the kind of
jobs developers but this is like call it
in air quotes the financialization of
Bitcoin and these these skills everyday
skills and expertise and professional
knowhow they're going to be in big
demand yeah it's interesting to me
because in the last cycle they were
borrowing a bunch of money to buy the
physical Hardware now they're just
skipping a step and they're borrowing a
bunch of money just to go buy the
Bitcoin and here's the thing so like if
if you're a minor and then then it
starts trading similar to micro strategy
if it starts trading at 3x what they've
got in their treasury like then why
aren't they going out there and just
issuing common stock and basically
buying the Bitcoin for a third of the
price
I don't like to ask for Price
predictions Preston but I I think you
know that well the term it's going up
for Laura just Springs to
mind going up for I conservatively I
think we're going to a quarter a quarter
Mill by the end of 2025 I like I don't
have much reservation saying that I
think that that's totally in the cards
and I think anything above that like
clear up to a million just wouldn't
surprise me
and this so I don't know we'll Sidle
into the Trump thing now because call it
the Trump pump uh he was he was very uh
he was very quick to Pat himself on the
back for the the bries of Bitcoin and I
loved cus was all over this he's like
it's the don't forget the harving bro
like you know this was prog
in but whatever the guy's a uh a
comedian at best what was it like for
you
with the run up to that uh I have no
idea your stance on politics or never
heard you really talk about it so it's
just stance on yeah my stance on
politics is really simple I don't like
politics and I don't like talking about
any of these politicians because I think
that they just they just pair it
whatever they think is going to get them
the most votes and then that's it and um
but I'll say this right the last
Administration for Bitcoin was
disastrous
like just
disgusting right everything I'm seeing
out of this Administration seems like
it's going to be very Pro uh the
treasury uh you know the Strategic
Reserve I think is potentially massive
as far as uh you know Sovereign
adoption uh I think it has the potential
to really kind of accelerate the
inevitable like in my mind so much of
this is inevitable what isn't inevitable
is is whether it happens faster or
slower and so what I'm looking at
everything that's playing out from a
political standpoint it seems like we're
taking the the approach that's going to
accelerate things as opposed to slow it
down um and I would just keep it really
kind of that
simple were you in Nashville I was in
Nashville yes did you watch the the talk
I was there I was there what what are
the cliff I have to be honest if I have
to be honest with you I felt like I was
losing brain cells as I was sitting in
there listening to it um
uh Kennedy's uh Speech was really good
like it was straight fire like and I
think Kennedy deeply understand it my
I've heard Kennedy has a pretty massive
position Bitcoin position
size like maybe nine figures position
size and he's he's he's close to the uh
you know obviously he's he's right there
in the mix with this incoming
Administration so um you know yeah and
again these are rumors that you I have
no idea what whether even owns a Bitcoin
I have no idea but those are rumors that
are passed around you know bourb so the
other the other hot thing on on the lips
of Bitcoin Twitter is uh Bitcoin Reserve
in uh in the
US
yeah I mean I think it's going to happen
I think it's going to be an executive
order on the first day I Know Jack
there's a clip of Jack Mer's gone around
saying I've heard that same rumor um and
yeah I think it's going to happen I
think he's going to do an executive
order you have cythia lumus Senator
Cynthia lumus out there she's already
proposed the bill um the question is is
like how much they're going to try to
buy uh you know the number I keep
hearing is a million Bitcoin so um I
think the bigger implication isn't them
buying a million I think it's all the
other countries that they attract in the
process from what I've heard another
Rumor Mill you know sitting around and
at the bar at night kind of talk uh is
that there's a lot of countries that are
already working on this and that they're
waiting for the US to make the
announcement a little bit as their
cover and uh yeah so like when the US
comes out and actually says that they're
going to do it that that you might have
three or four more that come out almost
on the same day to say that yeah they're
doing it and they have been doing
it holy Moon Juice Batman yeah so who
again these are all rumors this is like
I have dude I'm a very simple person
that lives a very simple life and uh I
just enjoy being with my family and
these are rumors that I hear when I go
around speaking it where whatever who
knows like the validity the validity of
any of it I have no
clue it's h can and here's the thing
Preston can you believe we're here
because I started this podcast in
2020 and thank you your work everything
that you did prior to that you know I
learned a great deal from you from tip
not just about like normal markets but
then following your Bitcoin Journey as
well and watching you go full lasery
Maxi was a thing of beauty uh the the
the I remember talking
to was it you or I think it might have
been Andy or even Jesse on a show in
2020 like what who's we just spitballing
who's going to be the first to announce
like which company like that was the
that was the fun thing to do right in
like early 2020 when we were all locked
down we had nothing to do like guys one
day somebody's going to figure this out
and then bam Mike just announces in
September that they'd bought it was
crazy like we're all high-fiving each
other chest bump it on bitcoin Twitter
look at today like yeah I'll be honest
with you uh you know when I was always
asked that question I always said it was
going to be the ones that are going to
do it first are the ones that have been
victimized by the dollar the most
they're going to be the ones that that
step into it first and the ones that
most likely will be last are going to be
the ones that benefited the most so you
know based on that I would have
suspected that the us would have been
really late um but another caveat that I
would always put on that answer is it
but it comes down to leadership right
like as a former military leader you can
have just amazing Leaders with just
incredible foresight that can lead this
body or this organization in a way
that's just that you never thought would
be possible or even you know it's just
kind of miraculous what some leaders can
do so you get to write leader into a
into a country that can see something
that can actually listen to the why and
can actually understand the problem you
can get results that you're not
expecting and um and that's not my way
of saying that I think that any
politician is a great leader or not I'm
just saying that it I think you know
comes down to individuals sometimes that
are in charge that can change the
trajectory of what uh a generalization
of like what will play out because
you're predicting the future right at
least you're trying to predict what you
think is the most likely outcome and
what I would say is individuals can
influence things especially if they're
in strategic and influential positions
they can they can change the course of
history so uh yeah I think I think we're
in
for 2025 in my opinion it's just it's
going to be freaking crazy
man so again the the push back you'd see
on on bitcoin Twitter would
be okay great they start stacking
Bitcoin on the uh on the balance sheet
in in the United States on the uh the
government's balance sheet is this not
just going to become paper Bitcoin in
the end and we'll just end up doing the
same thing that we've always done before
fractionally reserving paper promissary
notes again CH the Bitcoin Holdings yeah
um I mean this is always the concern
that you see because of what happened
with gold and bitcoin's not gold um you
know if if you tell me you have one
Bitcoin and that you'll pay me that
Bitcoin we can settle that right now on
this video call and I can prove real
fast whether you got it or not or you
know with gold that's just not how it
works you could hold the gold bar up you
could dangle it on the screen and I
could see it's real but that doesn't
mean that I'm going to receive it and
then I'm going to actually get it and uh
so we all know what makes Bitcoin very
different than than gold it is
inevitable inevitable that if this thing
goes all the way sovereigns are going to
have to own it okay so I guess what I
would say back to the person who's
throwing that up there
is what so what what can you do about it
and the answer is you can't do anything
about this that sovereigns want to own
it go back to well you know really poor
thing Bitcoin is for your
enemies okay Bitcoin is for everybody
whether you like them or not whether you
like how they're using it or not it's
for
everybody and um Can
people that are let's just say the ETFs
right I cannot prove that all those
Bitcoin are being custody by coinbase
for all those ETFs they could be totally
ripping everybody off okay but where I
am am confident is with time that can be
exposed whereas with gold I don't think
it can be
ever so that's where I hang my hat is is
you might be able to manipulate the
system by papering over it or whatever
in the short term but I think in the
long term it will always wash itself out
because there's always going to be some
whale that that look at sailor like if
you don't think that dude's calling
everybody's Bluff right now by what he's
doing and Mara and Riot and all the
others it
like so the other question would be
where are they going to get the cash to
buy it so one way would be from federal
income tax and the other way would be
to uh s sell bonds to the Federal
Reserve and use the Federal Reserve
money to buy yeah so that one that could
be sticky because the Federal Reserve
might see that coming and they'll be
like no we will not enter into that deal
if you're going to use these funds to
buy Bitcoin did you see that the concern
for me in the long term isn't how
they're going to be able to receive
Bitcoin because at the end of the day
the government's just a parasite that
sucks the energy out of its host okay
period so um they're going to find a way
to tax it or whatever and they're going
to receive Bitcoin that way the concern
is that as we're converting and changing
over to this new monetary system there's
going to be such a massive stop gap
between what they're accustomed to being
able to spend and the
psychological uh conditioning of society
and politicians alike as to what is
normal for what the government spends
their money on to like oh we're now
using immutable like sound money and we
can't just print you know hundred
billion and send it to the Ukraine or
whatever the number is right um all of a
sudden this uh the populace is going to
figure this out and they're going to be
very disgruntled but they're still going
to want the handouts and the the flow of
of the free energy that was coming out
of Fiat to the select few and so that
stop gap of like the transition is the
concern so like where are they going to
get the Bitcoin during that period of
time to feel the the massive void that
exists between what they're used to and
where this is is going next and that's
my concern with the ETFs if I have to be
quite honest with you m because I think
that
um you know with the stroke of a pen all
of a sudden it can be mandated that 25%
of the coins being custody by the ETFs
are now going into the Sovereign
Treasury and if you were a holder of
that uh congratulations bitcoin's up 25%
so you didn't really lose anything it's
just flat it's kind of like the
gymnastics that are going to be tried
and the thing is not your keys not your
coins and if so um be ready for whatever
Shenanigans the government is going to
try to pull with the stroke of a pen
because people don't want to go to jail
people don't want to go to jail if
you're the custodian of this and you're
coinbase and you're Brian Armstrong and
you're out there selling like a million
coins and doing your thing right um
he doesn't want to go to jail and so if
he gets some type of mandate that says
hey you got to give us 25% of these
coins like he's going to do it cuz he
doesn't want to go to jail so it's just
something it's a risk doesn't mean it
will happen it could happen that's
important I'm not saying that's what is
going to happen I'm I'm looking at it's
real simple I'm saying this transition
is going to cause massive issues with
respect to how much they have to spend
versus what the populace and politicians
are used to to spending so if true if
you agree with that how are they going
to fill that void and then the question
is is they've got to find a honey pot of
some Source that's liquid okay and when
I look around I see a couple of them
right Y and soow hanging fruit out there
and and micro strategy is one of them
micro strategy is one of them so the
question is is if if true which honey
Potter are they going to try to Rob and
how will they rob it and what will be
the story that's told to rob it and
here's another key consideration who is
impacted so if let's say I got to steal
a a million
Bitcoin okay if I steal the million
Bitcoin from this entity versus that
entity how many how many voting citizens
are in this one versus that one okay
because I'm probably going to go after
the one with less voting citizens
this stuff's simple I'm not predicting
anything I'm just looking at the
incentives and I'm saying if this
happens then that'll happen and then
this will probably happen and it's
interesting what you said about
apparently there being a few other
countries waiting for the us because not
only are they waiting they're going to
wait to see how they do it as well and
then the game theory kicks in it's like
oh right yeah they just robbed the
biggest exchanges and the publicly
listed companies uh we won't do that and
we will I think that comes way later
yeah I think that comes way later I
think that comes I mean truly Daniel
that's the oh moment that's the
moment when they where where nobody
wants to even accept your dollars and
you're looking at all the expenses that
you have lined up for the coming year
and you're saying okay if I print even
you know the amount of printing that's
going to be required at this point is
going to be so absurd and they're
looking at saying well nobody's even
going to take this stuff so we have to
get something that people will accept so
where do we go and what what pen stroke
can we do to to achieve the ends to our
means of of acquiring it um I mean it's
very dystopian it's a very dark lens
hopefully that's not how it goes down
but um again I'm not telling you what I
think is going to happen I'm just I'm
laying out the array of potential
outcomes so that people can make their
own risk-based
decisions and position themselves
appropriately based off of these known
risks it's all it is what Preston is
trying to tell you plebs is just self-
custody your Bitcoin get it off of The
Exchange get it off of any app that
you've used get it onto a bitbox or
anything equivalent whatever is easiest
for you to get your hands on buy
straight from that company don't go
through a third party salesman or go
meet go meet the company at a conference
or something but just get your keys that
is a and then sit back and enjoy the
fireworks it really doesn't matter what
happens after that because if it's on an
exchange here's the thing as well that
uh the this this game gets played in
financial markets and look wall Street's
here now whether you like it or not it's
here it's happened end the story
stop moaning about it it's not going to
change but now they will have the
ability especially with the options on
the ETFs built in now there's going to
be a lot of uh monkeying around
especially if we're coming towards a a
particular exper date with a particular
strike price spot markets will be
manipulated heavily to try and you know
get that price to the strike or keep it
away from the strike no doubt and plebs
are going to sit back and watch this
whipsaw and you know you will get shaken
out if it goes up too quickly because
you'll get oh my god I've got too much
of my net wealth net worth in in I've
got to sell some and the same will
happen if it whips all to the downside
so please just sit on your hands
like that's Preston and I have been
doing this for a long time please just
sit on your hands sleep well enjoy your
family life and eat well and be happy
yeah the the beautiful thing about
cussing your own Keys is is you can act
like a whale even though you're a minnow
right like you could have a really small
amount a small net worth and it's all
denominated in self- custody Bitcoin and
you hold the keys and like you can't be
shaken out of that and a lot of the
times when you give up control of
something you also give up the the
ability to sell it or buy it whenever
you absolutely need to which is then
used against you to shake you out of
positions and a whole bunch of other
things so um yeah and getting into the
timing of when things
are just I would I would keep it that
simple um but yeah what a time to be
alive what a time to have access to
everybody has access to technology to
tap into this if they want to like when
has that ever
happen it's crazy now uh lending
markets should the plebs be looking at
well I remember we did a show about this
back in 21 or 22 when this was becoming
a thing uh obviously the blocki thing
blew up that was very obvious for those
paying attention from the very beginning
that that was going to be nothing
nothing that you wanted to be touching
then celius uh we have we still have
Leen around we have deify which is
brought to you by hodle hodle uh am I
missing any
there the two big ones those are the two
big ones yeah then we had lotnik
announced that
BGC partners are going to be doing some
kind
of lending loaning collateral I love
talking about borrowing and lending and
and you know Max Kai from hdle hoddle
and now deify um in in my opinion here's
a guy that's been around for 5 years six
years plus he's been through multiple
80% moves to the
downside and everybody's always come out
alive and that and the users haven't
been ripped off so that you have to ask
yourself well what is he doing that's
different than everybody else he is
forcing it to be peer-to-peer and over
collateralized no matter what 247 and
then the frequency of the spot is also
vital which you know I think he's I
don't know but I think his frequency is
every block that they're checking the
spot price like 10minute intervals or
whatever so if you're doing this in my
opinion that's responsible borrowing and
lending because you're not creating a
trunch where some people are over
collateralized other people aren't and
you're sticking that into some type of
escrow and then all all of a sudden this
person over here that wasn't over
collateralized they actually have
another counterparty that caused them to
blow up and now they need to blow this
up and then it just Cascades this is
fractional Reserve banking this is under
collateralized fractional Reserve
banking um and espe it really gets
interesting when it's a very ill liquid
market like housing and things like that
okay Bitcoin is the opposite of all
these things and so if you do it in a
responsible way it's highly liquid right
extremely most liquid thing on the
planet right now practically U maybe is
um it's a 247 market so even if the
price moves outside of like your
collateral like it's trading 24/7 you
can still liquidate it okay um the
frequency is just non-stop that you can
check that spot price and your
counterpart you and I go into an
agreement you want to borrow $100,000
from me I give you the 100,000 you you
post 150,000 worth of bitcoin and some
type of escrow that'll immediately
liquidate if the price starts to drop
like I'm sorry that's pretty safe right
that that setup is very safe because
it's peer-to-peer so my concern moving
forward is you're going to have Banks
that are very accustomed to fractional
Reserve very a liquid markets checking
the spot price on weekdays from 9 to
five kind of mindset that's they're
going to bring this this crusty mothball
approach to bitcoin and they're
literally going to get their heads cut
off so uh yeah imagine a long weekend
and there's a a huge draw down over the
price of Bitcoin over that three-day
period what's happen Tuesday morning
9:00 a.m. like boom liquidated yeah so
it I would I would encourage people if
you really especially if you're in
traditional finance and you're in
borrowing and lending if you don't know
who Max Kai is with deify I would highly
encourage you to find out who he is on
Twitter follow everything that the guy's
done for the last half a decade and how
he's been able to run uh a borrowing and
lending platform for that entire time
without any type of issues because
that's how he was doing it
all right definitely worth checking out
for the plebs if that's a service they
need and there will be a few because if
you're 100% or even 90% in Bitcoin you
still need fear every day uh the
services just aren't in place yet there
are some out there where you can get
like the cards uh bit refill for example
zapo I'm not sure if they're Global then
you know it depends where you are in the
world wherever you're listening um
anyway I wanted to talk to you one one
other point on on that last one people
will look at the at the yields in these
markets and it's like 15% annualized to
borrow the dollars and you're over
collateralized with your bit you don't
have to sell your Bitcoin right so why
is the yield so high why is it 15% when
the rest of like traditional Finance is
you know 7% to go buy a house or
whatever it is right now the reason why
is the person who's going to lend you
let's say you want to borrow $100,000
the person who's going to lend you
$100,000 obviously understands Bitcoin
or else they wouldn't be participating
on an exchange accepting that as it's
collateral okay if the person actually
understands Bitcoin they're expecting at
least a 25% return annualized as opposed
to the 10 or 15% that you're going to
get on the Fiat that they would get on
the Fiat for Lending it so their
opportunity cost the lender's
opportunity cost is Bitcoin and the
lender understands this and the lender
would just rather own Bitcoin just like
you who's trying to post it as
collateral to borrow against so that's
why the yields are so high um so I where
I think this is going to get interesting
is when traditional Finance people that
are networked into these super low in my
opinion uh uh out of reality rates call
it six or seven per for a house like
people are like oh it's so high it used
to be 2 or 3% yeah right but the world's
changing like really fast and when these
people that are networked into the these
Legacy rates finally figure out what in
the world's happening I'm curious if
it's going to start bringing some of
that down another idea that I think is
really fascinating on the borrowing
lending piece is like look at um look at
tether so they're basically just mining
sovereign debt is what they're doing
they're just going out there they're
tokenizing they're making sovereign debt
avilable to every person in the world
and as a result they basically get the
coupon
for free because the person who's using
the token just wants it for the
saleability attributes and not the the
coupon that's associated with it so
they're basically making 5% off of
everything that they tokenize on
sovereign debt if you would take that
combine it with uh borrowing and lending
now all of a sudden if if they if they
were trying to achieve an a network
effect on the borrowing and lending side
they could maybe kick back or% of the 5%
or maybe even all of it uh you know to
try to to try to build like an enormous
amount of demand so like let's say that
the that the going rates are
10% uh and then you can kick back 4% of
that and now you're at 6% now you're
competing with traditional uh borrowing
and lending now the the the entity that
would be doing this would be only making
1% off of and you'd also have to have
your own stable coin so like I guess
when I'm looking at like where does this
go in the future I would be shocked if
tether or any of the other large Stables
don't start getting themselves into
these types
of uh borrowing and lending platforms
because I think when you when they're
additive you really start to compete
with Legacy borrowing and lending in a
way that uh a lot of bitcoiners would be
more than happy to lock up coins to to
borrow in um another interesting thing
sorry to keep going on here if borrowing
and lending starts to become way more
desirable for
bitcoiners think about the the liquidity
of Bitcoin in that scenario I'm going to
lock up coins for 10 years and they're
never going to go back on the market cuz
they're literally sitting in Escrow
because I want to go buy a fancy house
or something like what does that do to
the
price it's I I had thought about that a
friend of mine brought that up to me he
like wait a minute if we all just start
placing this as
collateral locked up four five six years
that's even less Bitcoin going back on
the exchange where the hell are these I
mean honestly does the math even add up
to you how are are these ETFs buying all
of the where is it coming from that's
the other thing all these ETFs so then
you're going to start getting products
that are like uh Hey we've got 500,000
Bitcoin here that don't give you any
type of dividend would you we'll go over
here and do borrowing and lending things
with them fully in Imagine deify right
who's doing this in appropriate and
reasonable and you know smart manner
where there's peer-to-peer it's over
collateralized yada y y all the stuff I
said earlier but they're going to do
this on behalf of an ETF that's custody
100,000 coins or something that and then
they kick back some of the yield to the
ETF
holder I'm just throwing out things that
the math to me is where a lot of this
people would be like this sounds like a
disaster I don't care what it sounds
like I'm telling you what people human
beings are going to try to do with this
mhm just through the natural incentives
in the math okay so you can be upset you
can say oh stop saying this just go in
the corner and cry and deal with reality
it might rain tomorrow for you are you
going to cry about that too right that's
how I see this this is just natural this
is nature working itself out and
experimenting and some something bad's
going to happen something Good's going
to happen like deal with it stop crying
there are going to be some spectacular
blowups that's for sure for sure and to
your point earlier about coinbase I I
just can't
yeah it it makes no sense that that
company uh the the amount of shitcoins
Brian he he was tweeting something about
Bitcoin uh this that and the other thing
about you know really bullish about
Bitcoin and and the truth of that is he
knows it like he knows he knows but yet
on that exchange you can't count the
amount coins and you can't like the
incentive structure is all built around
trapping your customer into trading in
and out in and out so you can get the
commission and pushing notifications to
them to make them addicted to their app
and all of this all of this bad bat
stuff degenerate stuff but you know what
hey that's what makes a market Let Brian
go do his his thing and if it if it
results in his demise so be it right
here's here's another thing that is a
frustration point for me I firmly
believe in free and open markets right
and if Brian wants to go out there and
rug pull people and do all these
degenerate things you know what I think
that he should be allowed to do those
things and I think that what it's going
to do is force it's going to violently
Shake people to wake the hell up and
stop being so stupid okay this Hawk two
coin and this girl God if you bought
that and she stole $10,000 for you
congratulations you're an idiot okay I
don't feel bad for you I think you're an
idiot and the fact that you have less
buying power in this world moving
forward and sorry I think is a good
thing because I think you're a and
I think that morons should be penalized
I don't think that they should have
benefits if you're stupid and you don't
work and you don't put in the the real
effort to to be better into progress
Society well I don't care that you don't
have a lot I I just
don't har words Preston but very true it
is Harsh it's it's that's what the free
market is it's called personal
responsibility there you go so if I go
outside and I trip and fall do I blame
the sidewalk or do I blame myself for
for not you know
walking right like I missed it I I
messed up like I go out on the golf
course which I never do because I can't
stand the game but I hit a bad shot and
I hook it into the woods is it the woods
fault is it my golf club's fault no it's
because my swing is total trash right so
like take responsibility for yourself
it's that
simple all right we got to touch on ego
death what's going on yeah yeah no I
mean when did you start that
position so we started ego death
probably two and a half three years ago
I would say we have the first fund which
is primarily focused on startups early
stage seed uh and then we have a second
fund that is primarily doing series A's
and this is all only in Bitcoin um
Bitcoin companies and um and a little
bit of seeds in the second fund as well
so if people are listening and you've
created a company and you're looking for
funding and you got a great idea you
think you got some type of long-term you
know uh Mo and uh capability hit us up
we would love to to uh take a look at it
and uh talk to you and then if there's
any you know limited partners that are
looking to move the ecosystem forward
and um you know the most common this is
interesting the most common question we
get when we're talking to potential
investors which I love this question is
why in the world would I invest in this
versus just owning Bitcoin and it's the
most fair question anybody could ever
ask and uh you know the response that
that I give them is just because we're
investing in this space we are you know
our hurdle rate is Bitcoin like if we if
we're trying to invest in a company and
we don't think that that company can
grow faster than Bitcoin and we don't
think that that founder will retain
their earnings in Bitcoin and do all
those types of things like it's just an
easy no like because we ourselves want
to keep our money in Bitcoin if if it
can't exceed that hurdle rate and for me
when I'm looking at when you look across
the spectrum of things you can invest in
in my humble opinion like one of the
only things you you can invest in that
can actually outperform Bitcoin is it's
twofold first of all it has to be in an
industry that's just ripe for disruption
right so Finance is ripe for in my
opinion is ripe for disruption I would
also say like AI is you know like
everything that it's going to touch is
ripe for disruption you can buy equity
for $10 million it'll go to a billion so
those that return profile you have to be
in something that is very large
industry-wise and that it's going to be
completely dematerialized and so like I
look at Wall Street I look at finance
and I say okay check the next thing is
is you have to invest in something
that's very early stage or you know has
tons of growth Prospect that's
there and when I look at a lot of these
companies and the the size of the
companies that we're investing in
they're very early stage they're you
know some of them are free Revenue to
some you know the revenue is a million
to $3 million right now and we think
that it has the potential to go to half
a billion plus so if you're if you're
looking at just the math that's pretty
much the only way you can outperform a
Bitcoin hurdle rate and then I think
there's a little bit of a kicker that
they're Bitcoin companies so like all
these Founders come predisposed with
this idea who would you give it to I
know that sounds terrible um I remember
your first response you you've answered
this question three times already I
think do you remember your first one I
yeah I remember my first one I'm not
proud of it go on
who was it I think it was Ry right it
was Ray Delio you're right yeah and you
didn't you didn't skip a beat I asked
you the question and you went Ray Alia
and I was all over you I was like yes
that's an awesome that is a great answer
because he had been so influential uh
you know do you remember you you know
obviously but the listeners he had this
like explainer video like it was
handdrawn sketched about how the economy
works and all of that and I remember
going down the rabbit hole of all of
this just financial markets in general
finding it really really interesting
that the way I'll say this this is why
he gave me this this is why I said him
is because I didn't understand long
long-term credit Cycles I didn't
understand uh the debt markets and how
it had basically you know that we were
in this big giant long-term credit cycle
until I discovered Ry and studied Ray
and so I would have never been a
bitcoiner if it wasn't for Ray through
studying his material and so I guess at
that time I was kind of like oh yeah I
really wish this guy would get it
because I would have never been a
bitcoiner if it wasn't for him um and
it's interesting because I saw he's he's
out in the past week saying you know
definitely don't own bonds and you know
you need to have gold or Bitcoin in your
portfolio but it doesn't seem like he
really actually understands Bitcoin that
well uh he understands the case for why
Bitcoin would do well but like actually
understanding Bitcoin I haven't seen
anything that's impressive me um at this
point Bitcoin I think is is truly taking
on a life of its own I don't think it
matters whether this billionaire or this
company or this country understands it
or not I think that they're going to be
forced to figure it out and understand
it and um in a way I I kind of view the
natural filtering to maybe be really
beneficial to society because what
you're getting are the Hawk 2 people are
getting minim IED and pushed to the side
and they have no control or influence on
society moving forward because they're
they're just going bankrupt and losing
all their money and all their influence
through the lack of funds and the people
who are deep intellectual thinkers and
uh good quality human beings are the
ones that are figuring this
out um and they're very positive and
like I don't know I could go on and on
about what I think about the bit Bitcoin
like true bitcoiners and I find it very
refreshing that that they're the ones
that are naturally accumulating the
coins and I think that this is going to
benefit Society more way more than if I
could say oh I wish this person had it
like I'm kind of glad they don't if they
haven't figured it
out love it mic drop Preston how can
people find you what's the best place to
come and interact with you I am active
on I'll say it the right way X Twitter
whatever uh just at Preston pish I have
a podcast it's uh we study billionaires
is the feed and the Bitcoin comes
out every Wednesday uh ego death Capital
uh if you go to egod death. Capital um
for people that are interested in in
funding for startups in the Bitcoin
ecosystem we would love to take a look
or if you're a you know uh an individual
that would like to invest in that just
go to the website and fill out the form
it'll take you 30 seconds and you're on
Noster 2 so your n Pub would be Noster 2
I'm on Noster too yeah that's that's
something we didn't talk about was all
right primal do the noer in a
nutshell no I think that uh you know
just like money being vital for like at
the base layer for energy exchange I
think that uh open free free and open
communication is vital for establishing
contract terms of the exchange of energy
and so when we're talking about the
exchange of energy we're talking about
Bitcoin we're talking about the free and
open communication of the contract terms
we're talking about Noster and I think
the Noster protocol is going to continue
to to grow I I'm super bullish on this
and right now it looks like it's like a
Twitter like experience if you go on to
any type of client that gives you access
to Noster the Noster protocol um but I
think with time it's going to evolve
into other things that like we just
really can't even wrap our head around
but I think at the core of it is this
idea of open
communication and to establish contract
terms between entities and individuals
and maybe even you know
AIS uh moving forward because I mean if
an AI wants to establish a contract with
you know some other AI is it going to
want to do it on some type of platform
that's controlled by some human that
could you know manipulate the terms and
conditions or whatever or do they want
to do it in some type of redundant node
that's backing up exactly what was or
wasn't said and it's signed by you know
encryption and gets the latter so yeah I
would call it the identity layer as well
would probably be maybe another way
to uh look at it so very very important
and I'm I'm an adviser on Primal which
is you in my opinion the best client out
there for uh accessing Noster and highly
encourage people to try that out they I
think they would have their minds blown
if they went on download the Primal app
just go on to any app store type in
Primal download it create an account
within a minute you'll have a wallet a
Bitcoin wallet and just go in there and
use it a little bit I think you'll be
blown away blown away at what you you
find yeah it's great fun I'm enjoying it
on on nosto and yeah I'm a user of
Primal as well and in touch with the
guys over there so yeah well thanks for
coming on thanks for everything that
you've done and continue to do for
Bitcoin and yeah look forward to seeing
you again soon likewise Daniel really
enjoyed it bud